N.Y. Sues Another Alleged Spyware Company

New York's attorney general sued another Internet pop-up advertising company Tuesday, accusing it of secretly installing malicious programs on personal computers and sending ads through "spyware" that is already installed.

Eliot Spitzer said Direct Revenue LLC has installed millions of pop-up ad programs that also monitor the Internet activity of users. He asked a state court to stop the practice.

"These applications are deceptive and unfair to consumers, bad for businesses that rely on efficient networks to do their jobs, and bad for online retailers that need consumers to trust and enjoy their online experience," Spitzer said. "We will continue to side with consumers in their fight for control of their desktops."

Spitzer, who is seeking the Democratic nomination for governor this year, already has sued one company on allegations they install spyware and adware -- software that can be downloaded onto personal computers generally without the computer user's full knowledge.

Spitzer ultimately settled with Los Angeles-based Intermix Media Inc. for $7.5 million in penalties over three years. Intermix, which also developed the popular social-networking site MySpace, is now part of News Corp.

In the lawsuit, filed in state Supreme Court, Spitzer claims Direct Revenue or its distributors offered free games, browsers or software without mentioning that they would come with VX2, Aurora, OfferOptimizer and other adware downloads.

After such "drive-by downloads," which he said his investigators got when visiting at least 21 Web sites, the company can track consumers' Web activity and deliver pop-up ads, Spitzer said.

Spitzer said the company also thwarted consumers' attempts to remove the spyware.

Officials with New York City-based Direct Revenue didn't immediately respond to a request for comment.